Press Release Private Equity United States Workers

Hospital-at-Home Care: Opportunity or Threat for Patient Care?

January 24, 2023

Contact: Dan Beeton, 202-239-1460Mail_Outline

A temporary solution for the COVID-19 healthcare crisis may become a permanent problem for patients, workers, and taxpayers.

Washington, DC — In response to the surge in hospitalizations due to COVID-19, hospital-at-home (H@H) programs emerged as an alternative for providing care to the acutely ill. Intended as a temporary measure to relieve overcrowding and the shortage of hospital beds, the program was recently extended by Congress to the end of 2024. In a new report, CEPR’s Eileen Appelbaum and Cornell University’s Rosemary Batt reveal the opportunities and pitfalls of new H@H programs for patients, healthcare providers, workers, and taxpayers. 

In “The New Hospital-at-Home Movement: Opportunity or Threat for Patient Care?” Appelbaum and Batt report that H@H programs, certified by the Centers for Medicare and Medicaid Services (CMS) in 2020, allow hospitals to waive important patient care standards while receiving the same reimbursement rates that they receive for in-patient care — despite much lower overhead and infrastructure costs in H@H programs. 

This CMS waiver builds in large financial gains for hospitals and home health agencies by allowing them to cut costs through use of lower-skilled workers to replace RNs and to shift care to patients’ families. It has also attracted the interest of venture capital and private equity. The authors document a surge in financial investors in the program. “Home health agencies, increasingly backed by private equity owners and in partnership with venture capital healthIT startups,” the authors note, “are clamoring to gain access to CMS funding of H@H services to add to their suite of home health, palliative care, and hospice offerings.”

Key findings include:
  • CMS developed the H@H program in response to a public health crisis and waived patient care standards, including requirements for 24/7 care and the use of RNs for bedside care.
  • Congress approved the extension of the CMS waiver program through December, 2024, despite the fact that public health crisis conditions have waned substantially and that no data exist on the relative care quality and costs of in-patient versus H@H services.
  • CMS has not developed the necessary standards, measurement tools, data collection, or monitoring and auditing processes to assess care quality and costs in H@H programs.
  • The lack of adequate CMS standards, measurement tools, data, monitoring, and auditing processes for H@H programs provides incentives for financial interests to take advantage of taxpayer subsidies for private gain. 
  • As the lines between hospital and at-home care become blurred, clearer standards are needed for who is legally responsible for medical errors or liabilities. 

H@H was a temporary, and needed, response to the COVID-19 crisis. However, ongoing efforts to permanently embed the program as an alternative to hospital-based care raises alarms over care quality, patient safety, de-professionalization of the workforce, cost-sharing, and more. Despite enthusiasm from proponents, research evidence that the benefits will outweigh the costs for patients, families, and taxpayers does not yet exist.

Support Cepr

If you value CEPR's work, support us by making a financial contribution.